The broad based acceleration of inflation combined with the erosion of homeowner equity may jeopardize the effectiveness of loss mitigation strategies being deployed in the housing market. The time has come to closely monitor the most effective loss mitigation centers and deploy proven models with subtle geographical variations for optimum effectiveness.

All loss mitigation scenarios need to accommodate for an inflation component. True crisis management suggests that protecting the strong homeowner mitigates collateral damage and this is apparent as we see wide spread variations in zip code specific valuation resilience.  

The Obama Administration should consider doing the following:

·        Doubling the first-time homebuyer credit to $16,000 for six months.

·        Allow for investors to participate in the first-time homebuyer credit with a minimum of 20 percent down payment.

·        Identify the state specific homeowner programs that are performing well.

·        Continue to add liquidity and with forensic/perpetual due diligence at the forefront of every underwriting model for the next generation of homeowners that are rewarded with this standard of care.

This is the bottom of fourth inning!

Joe Henry

Keller Williams/McLean

bankowned@mris.com

Well, we can see where all the rich investors live...Vermont.

Foreclosure....just another word for THEFT!

That’s right. We’re in the fourth inning. The prices are false bottoming in some states and still free falling in most.

I love it when the government brings out the punch bowl, and now puts the bowl within the reach of the middle class. Enough with helping out the government’s mega billionaire friends, i.e., — Goldman Sachs, Citi and others.  

And don’t worry about who’s going to clean the mess up after the party is over. The world is going to come tomorrow morning and clean it up. Remember, we got their money.

Carlo

Doubling the first-time homebuyer credit to $16,000 for six months !  I DONT THINK SO !  ALL SHOULD BE REQUIRED TO HAVE A 20 PERCENT DOWN PAYMENT ! ARE YOU FORGETTING WHAT GOT US IN THIS MESS TO BEGIN WITH !!!!! HELLO !!!!!!  ONLY A REAL ESTATE AGENT WOULD SAY THIS !

I agree with you Jim! Only a Realtor would want more relief programs so they can sell more homes to more unqualified people. If the government needs to do anything, they need to enforce higher education to sell real estate, not just some house wife, or losers who failed in other career and then found real estate as easy money. All they think about is the commission at the time the sale closes, not whether or not the homeowner can afford it. In times of chaos, you don't panic! You go back to the basics. Homeowners need 20% down to buy a house (period!); no government credit, no secondary mortgage, junior finanancing. Americans need to go back to work or learn new skills to find work and save their money to buy their home. It may not be a quick fix but in time prices and value of the dollar earned (NOT borrowed) will be real again.

I see the danger in doubling the homebuyer credit, especially under the current structure where buyers can basically use the credit as a down payment and therefore front very little, if any, of their own money to purchase a property. Sure, the credit is technically their money, but it's money they wouldn't have unless they purchased a home.

On the other hand, since the credit is not a loan and does not have to be repaid, it gives the homebuyers instant equity (a point HUD Secretary Shaun Donovan likes to make) and therefore more likely to hold on to that asset and not walk away from it if they hit some financial turbulence down the road.

Maybe doubling the tax credit should only be considered if it goes hand in hand with requiring a larger down payment from the buyer's own pocket before they receive the tax credit.

I do like Mr. Henry's idea of expanding the tax credit to investors.

This a response to N24REAL, I live in Vermont and I am TRYING to sell some RE here.  There are VERY few rich investors here, actually, just a lot of very savvy Vermonters who don't overextend themselves by buying houses out of their ability to afford, and also a lot of smart local banks who won't let you do it anyway!  We DO have a lot of homes on the market however, and prices have dropped 15 -20 % in the last 12 months.  I would prefer to see the first time home buyers get a chance to buy a place instead of paying the skyrocketing rental fees, so I think the tax credit increase would be a good idea, here, anyway.  

Just how do you expect first time home buyers, who make minimum wages, to save up 20% for a down payment, when they also have to pay $700-800 month rent for a halfway decent place?  10 % is more than enough for them to come up with...

I don't like the idea of giving the tax credit to investors.  They will get enough from the rental fees they charge, and they no doubt will be fairly high so that no one except those holding Section 8 vouchers need apply.  We never got a tax credit when we bought our house 47 years ago - and yes we refinanced when the city increased our housing values across the board due in some part I believe to the comp manipulations of certain individuals who really scammed $$$ and left vacant uncared for houses  before the rush of foreclosures even started.  Now that the housing values are falling  - went from $176,000 down to $121,000 in 2 years, we are in the group that owe more than our property worth.  Refinancing like many, but we are able to handle it so far.  But we keep going as best we can, we don't ask for handouts nor expect them, we make improvements with cash when it is saved up, we don't compete with the Jones's as the old saying used to go, we don't have snowmobiles, campers, motorboats, fancy cell phones, a lot of regular phone custom services.....get the message, live within your means, but then too, our means have never given us the chance to make so much money that we could make money off money.  What's it called - working class!

Hey KLW,

If somebody is low skilled ,making minimum wages this person should not be a homeowner PERIOD.

The Clinton's era experiment of giving mortgages to low income people is a clear example. They might have subsidied housing, renting etc but never a 200K + mortgage that they will never be able to repay.

Do not forget history so we do not have to repeat it

This whole housing fiasco was created by the media. When the daily news inflicts panic on homeowners by broadcasting daily that the housing market is a bubble about to burst, of course investors and homeowners flood the market with houses which drives down prices and the banks get scared of the properties they own which they must now write down and of course the bubble which was possibly over inflated, but most likely not to the point of bursting suddenly bursts.

It's the same media that covered up the facts and slanted the news to skew the election of what appears to be the worst President in U.S. history.  

July 20 was his sixth month in office and look at what is happening. And we're in for three and a half more years of this.  

jai,

Media is responsible for this.............Congrats. U seem to figure out the problem that entire country is trying to solve.

I see that your foreclosure rates are based on housing units; i.e. “…1.19 percent of all U.S. housing units (one in 84) received at least one foreclosure filing in the first half of the year.”

Isn't this misleading? Not all housing units have mortgages.

Rate of foreclosures by metro should be based on housing units with mortgages. You can't foreclose on homes with no mortgages.

Nick,

Ideally we would use housing units with mortgages but when we checked into this in the past we were not able to find a source for updated numbers on that across the country and down to the county and zip code levels. We'll check on that again. Any information you have is appreciated.

Daren

I never cease to be amazed at all the people who are looking for someone to blame. The only people who are responsible for this mess are the average American. We have spent the last 20 plus years getting what we wanted when we wanted. Sure, corporate greed has a TON of blame in all this and not nearly enough of those people are in jail. I cannot help but laugh at all the idiots who want to blame this on Realtors. My guess is most of them are people who ended up at some fast food joint flipping burgers and now they are pissed at the world. If you think being a Realtor is so easy then shut your mouth and show us all. I am sure you will make it about 3 weeks. This problem is caused by ALL of our greed, nothing more.....nothing less. Quit your crying and do something to make it better.

S.R.

J,

Well, we saw more than 1.5 milliion properties nationwide receive some type of foreclosure filing between January and June 2009. More than 400,000 of those were bank repossessions (REOs). Both those figures are based on RealtyTrac's report.

Let me know if that answers your question.

I heard a news story yesterday that most economists believe the recession is over.  I guess we don't have to worry about the graphs in the story, because the recession is over. Don't worry about the fact that we still haven't reached the peak of the foreclosure crisis, because the recession is over. We also don't have to worry about the fact that Fanny Mae and Freddie Mack continue the same real estate policies that got us in this mess to begin with, because the recession is over.

Just one question: Does anyone in government have a brain, or are they required to leave it at home when they go to Washington?

Sherm

Foreclosure filings in San Diego are still happening at record pace, although getting a short sale approved is getting more and more difficult.  Lenders are increasingly putting hurdles in the short sale approval process. It is no wonder that foreclosures are still at record highs.  

Thanks for the information Daren. Do you happen to know approximately how many actual homes have been repossessed (nationwide) since the subprime crisis began until now?

Thanks again, your help is much appreciated.

J

feds have no business ttiseng up any criteria save for loans that end up with the GSEs, FHA and Ginnie (VA). In that case, they are only laying out guidelines for lenders that tell them know what loans they will accept for approved purchase on the secondary market. This is what the secondary mortgage market does.  Their criteria is key.  This is why the housing market bubbled and burst; because the secondary mortgage market lowered their standards to a ridiculous level.  It makes no sense to say government cannot set these criteria that is what FNMA and FHLMC do.  Since they guarantee 90% of the housing inventory, this is not a business they can no longer be in.  Until these institutions disappear, that is what they do.  That is a part of their responsibility.  I agree that they should not be there and that this should be done by someone not in government, but that option does not exist for us until these houses are taken off their books.  Not only must the houses be sold, but the mortgages for those houses must be sold. Now, if we ever reach a point where there is no more FNMA or FHLMC, then we can say,  Government should not be ttiseng these standards.   As long as those entities exist, they will be ttiseng lending standards, like it or not.Reply

YvpYvn  <a href="ytmbvrgmbfsd.com/.../a>, [url=http://fxbxdelaevoi.com/]fxbxdelaevoi[/url], [link=http://kxgrsvzxezjy.com/]kxgrsvzxezjy[/link], http://ncgkxijsyslu.com/

What i do not realize is actually how you're no longer really much more smartly-favored than you may be now. You're so intelligent. You realize therefore considerably in the case of this subject, produced me in my view consider it from a lot of numerous angles. Its like women and men don't seem to be interested until itˇs one thing to accomplish with Girl gaga! Your own stuffs great. All the time maintain it up!

i7Rw9X Fantastic blog.Really thank you! Awesome.

Thank you for the good writeup. It in fact was a amusement account it. Look advanced to more added agreeable from you! However, how could we communicate?